An investor coalition managing £2.2trn in funds has filed a shareholder resolution to demand Sainsbury’s to pay a living wage to all its workers.
The actions, which is first shareholder resolution calling for a listed firm to become a Living Wage accredited employer, is led by responsible investment NGO ShareAction and includes the UK’s largest asset manager, Legal and General Investment Management, and the largest workplace pension scheme, Nest and 108 individual shareholders.
ShareAction said Sainsbury’s workers are facing a cost of living crisis amid soaring inflation.
The Independent Food Aid Network reported that it had seen an increase in supermarket workers using their foodbanks over the course of the pandemic, while research conducted by Organise found that one in three Sainsbury’s workers regularly worried about putting food on the table.
In January, Sainsbury’s announced new pay rates for its directly employed staff, with basic hourly pay of at least £10 per hour. The new rates will see it match the real Living Wage for staff in inner London and outside the capital. However, its rate of £10.50 per hour for workers in outer London is considerably lower than the real Living Wage for that region (£11.05).
Additionally, Sainsbury’s have not made any commitment relating to the pay of third-party staff, such as cleaners and security guards, who ShareAction said represent “the most vulnerable workers in the most insecure work”.
“Excluding third-party staff from pay uplifts creates incentives for businesses to increase their use of outsourcing, reinforcing the growth of insecure work,” the group said.
Furthermore, Sainsbury’s have made no commitment that pay will continue to increase in line with the cost of living in future years. Accrediting as a Living Wage employer would remove this uncertainty and guarantee all workers a wage that they can live on, ShareAction said.
Martin Buttle, head of good work at ShareAction, said: “Low paid workers in the supermarket sector are being hit incredibly hard by rising living costs, yet we all owe them so much following the pandemic.
“We hope this resolution will catalyse long overdue change. The directors of all supermarkets that aren’t accredited as Living Wage employers should be asking themselves why not and taking steps to put things right by their workforce before their investors force the issue.”
While this resolution is being filed at Sainsbury’s, the investors in the coalition are making the same ask of all UK supermarkets and will send letters to this effect next week.
Diandra Soobiah, head of responsible investment, Nest commented: “We want to see sustainable, long-term business decisions from the companies in our portfolio, such as paying staff and their contractors a living wage.
“Research shows a fair salary helps sustain a more productive, motivated workforce who are likely to stay longer with the organisation. That’s why we’ve co-filed this shareholder resolution and will continue to encourage large UK companies we’re invested into to become accredited Living Wage employers.
“We’ve all seen first-hand the important role supermarket workers played during the pandemic, a timely reminder that the most valuable asset a company has is its workforce.”
Shareholders will vote on the measure resolution at the supermarket’s AGM in July, with the motion requiring 75% approval from shareholders to pass.
Global brewer Heineken has announced it will withdraw from the Russian market due to the country’s war on Ukraine.
Heineken said it was “shocked and deeply saddened to watch the war in Ukraine continue to unfold and intensify”.
It had earlier announced it would stop new investments and exports to Russia, ended the production, sale and advertising of the Heineken brand, and that it would not accept any net financial benefits or profit from its business in Russia.
However, it has today concluded that its ownership of the business in Russia is no longer “sustainable nor viable in the current environment”.
It said it aims for an orderly transfer for the business to a new owner in full compliance with international and local laws.
“To ensure the ongoing safety and wellbeing of our employees and to minimise the risk of nationalisation, we concluded that it is essential that we continue with the recently reduced operations during this transition period,” it stated.
It will guarantee the salaries of its 1,800 employees will be paid to the end of 2022 and “will do our utmost to safeguard their future employment”.
Heineken said it will not profit from any transfer of ownership and therefore will take an impairment of €400m on the business.
“Upon completion of the transfer Heineken will no longer have a presence in Russia,” it said. “We continue to hope that a path to a peaceful outcome emerges in the near term.”
Elsewhere, Domino’s Pizza Group has appointed Tracy Corrigan as an independent non-executive Director, with effect from 5 May.
From 2014 to 2020 Tracy was the chief strategy officer of Dow Jones & Company where she oversaw the digital transformation of that business. She previously held a number of senior management roles within Dow Jones and the Financial Times.
She will be a member of the board’s sustainability and nomination & governance committees.
Chairman Matt Shattock commented: “The Domino’s Board has been transformed over the last two years and is more diverse than ever before, with a rich mix of talent and experience around the Boardroom.
“Domino’s is a digitally-led business with over 91% of system sales being generated through digital channels. Tracy has broad-based business experience together with a deep experience of enhancing the digital capability of businesses and optimising revenue generation. Tracy’s skill set will be highly complementary to the Board. I am delighted to welcome Tracy to Domino’s.”
On the markets this morning, the FTSE 100 is up 0.3% to 7,508.1pts.
Early fallers include Deliveroo, down 1.2% to 112.5p, THG, down 1.2% to 82.7p and B&M European Value Retail, down1% to 554p.
Risers include McColl’s, up 7.4% to 2.35p, Glanbia, up 4.8% to €10.90, McBride, up 3.7% to 45.1p and Nichols, up 2.8% to 1,380p.
This week in the City
Another fairly quiet week in the City is highlighted by the monthly Kantar grocery figures on Tuesday.
In terms of company news, tomorrow brings full year results from AG Barr and McCormick’s Q1s in the US.
Also in the US, Boots owner Walgreens Boots will post its Q2 results on Thursday.